The cost of redeveloping Grey County’s Rockwood Terrace Long-Term Care Home is going up.
On Thursday, in a 74-22 vote, County council approved increasing the upset limit for the work from $92 million to $96.7 million.
Plans for the home include redeveloping a ‘Class C’ facility into a ‘Class A’ facility with 128 beds. The province has mandated that all homes be upgraded to ‘Class A.’
Back in March of this year, council heard the estimated cost for the project had increased to about $125 million compared to a March 2022 estimate of about $108 million.
At that time, council directed staff to work with project managers and cost consultants to reduce the cost of the project to an upset limit of $92 million.
A number of things were then removed from the redevelopment plan, including a 40 unit assisted living portion and a ‘village square.’ Staff also worked to revise site and drainage plans as well as to review project line items.
They say the revised $96.7 million project cost is within 5 per cent of the target amount and a reduction of about 23 per cent from the original cost.
CAO Kim Wingrove explained to council, “The 92 million dollars was a target that we had provided to our consultants.”
Wingrove also explained, most recent estimate comes from cost consultants Turner and Townsend, saying, “It’s their job to take a look at the details of a project and come back with what they believe is costing based on their extensive knowledge of what’s happening in the marketplace.”
Long-Term Care Committee member and Town of the Blue Mountains Mayor Andrea Matrosovs noted in discussion, “I do think that in the term of this new council thus far, we made a prudent decision to do something that we didn’t want to have to do, but we did pull back on the village square and on the assisted living— something that so very much could provide some public good, but we were careful about our spending and said, ‘okay let’s pull it back and really concentrate on what we need to continue to deliver.’
She added, “This is not the only community build in any of our communities that is experiencing these escalating costs. We’re all becoming disappointed in our own communities about other builds that we would like to do that are not coming in the way that can.” Matrosovs shared a concern that further delay in a decision about the upset cost risked jeopardizing timely funding from the provincial government.
There is an August 31st construction start deadline for the latest round of provincial construction funding. The county is unlikely to meet, but it plans to advocate at the upcoming Association of Municipalities of Ontario Conference (AMO) in August for the next round of funding.
To pay for the project, staff estimate a debt of $77.6 million will be required and financed over a 25-year term.
They say after taking into consideration provincial construction funding over the term of debt, an annual levy requirement of $4.3 million will be needed. Staff say interest on $77.6 million financed over 25 years would total $55.8 million.